By now, most people have heard of the United Airlines incident that occurred earlier this week. A paying customer was dragged off a United flight by officers when he refused to leave an overbooked flight. The graphic video, which shows the bloodied man being dragged down the airplane aisle, went viral instantly, creating a frenzy on social media and for reporters. While CEO Oscar Munoz vowed “This will never happen again”, many remain critical considering his initial controversial apologies. But what impact will this event have on United’s reputation and brand? While some PR crises have minimal push back on long-term financial performance, this specific incident may have serious consequences for UA’s business outcomes and reputation say brand experts. Business Insider depicts what has happened to United’s stock price since the incident , pointing out that as of Wednesday, April 12, UA’s stock’s lowest price was -4.3% below the open, resulting in a loss of $1 billion. Warren Buffett’s Berkshire Hathaway owns 9% of all outstanding shares of United Continental Holdings Inc., and is estimated to lose up to $87 million because of the incident.
PR: Repairing the Damage
Many brand experts are speaking out about how much damage the airline has done to its brand, with most coming to the conclusion that United has a long way to go in order to repair the damage that was caused by the recent incident. Most large companies will face a PR crisis at some point or another. But United took a PR crisis and turned it into a total disaster. Matt Rizzetta, CEO of North 6th Agency believes United now needs to focus on customers who state they’ll never fly united again as well as those who are staying loyal to the company. He states:
“If the initial reaction on social media and at office water coolers is any indication, United has already lost a significant group of customers. Right now, United would be best served to approach its communications strategy into two customer retention buckets; one for customers that are still remaining loyal to the brand, and one for customers that claim they are never coming back to the brand. For the first bucket, it’s all about quick and swift communication that reinforces United’s values and shows immediate differentiation from the competition. The second bucket is a long-term strategy that will require a more personalized approach and can only be rebuilt over time.”
I would add that there’s a third bucket, China. As the doctor who was attacked was originally reported to be Chinese, people in China reacted fervently. A Chinese student in the UK began circulating a petition against the transportation giant with the hashtag #ChineseLivesMatter. And, Weibo, China’s Twitter equivalent, had over 85 million posts referencing the incident by late afternoon on Tuesday. (The incident happened on Sunday.) China is a huge market and a PR strategy that is sensitive to the Asian culture is the third imperative in this mix.
Many communications and PR experts share similar sentiments, but all agree that United has a long way to go in terms of repairing the damage done to its brand.
For more marketing and advertising insight, make sure to follow FiG Advertising on Facebook.